Nola Ltd leased a highly specialised machine with an eight-year useful life on January 1, 2021. The lease agreement is for an initial two-year period with the option to extend the lease for a further three years. Based on discussions had with the lessor, the likelihood of exercising the lease extension option is very high. The company has agreed to make payments of $8.7 million per year in arrears, a sixth of which relates to annual insurance premiums. The incremental borrowing rate is 13%, while the interest rate implied in the lease is two percent higher. On the date of signing the agreement, the company received a lease incentive of $480,000 in the form of a cash rebate. Legal fees of $820,000 were incurred for the drafting of the lease agreement. REQUIRED: Determine the lease liability and right of use asset as at January 1, 2021. Prepare the amortisation schedule for the term of the lease. Prepare the relevant financial statement extracts for the financial year to December 31, 2021.